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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsReich: Resurrect Glass-Steagall!
http://inthesetimes.com/article/18493/hillary-clinton-bernie-sanders-glass-steagall-wall-streetThe idea is pretty simple behind this one, Senator Elizabeth Warren said a few days ago, explaining her bill to resurrect Glass-Steagall. If banks want to engage in high-risk trading they can go for it, but they cant get access to ensured deposits and put the taxpayers on the hook for that reason.
For more than six decades after 1933, Glass-Steagall worked exactly as it was intended to. During that long interval few banks failed and no financial panic endangered the banking system.
But the big Wall Street banks werent content. They wanted bigger profits. They thought they could make far more money by gambling with commercial deposits. So they set out to whittle down Glass-Steagall.
Finally, in 1999, President Bill Clinton struck a deal with Republican Senator Phil Gramm to do exactly what Wall Street wanted, and repeal Glass-Steagall altogether.
What happened next? An almost exact replay of the Roaring Twenties. Once again, banks originated fraudulent loans and sold them to their customers in the form of securities. Once again, there was a huge conflict of interest that finally resulted in a banking crisis.
This time the banks were bailed out, but millions of Americans lost their savings, their jobs, even their homes.
A personal note. I worked for Bill Clinton as Secretary of Labor and I believe most of his economic policies were sound. But during those years I was in fairly continuous battle with some other of his advisers who seemed determined to do Wall Streets bidding.
On Glass-Steagall, they clearly won.
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Reich: Resurrect Glass-Steagall! (Original Post)
eridani
Oct 2015
OP
portlander23
(2,078 posts)1. Yep
Octafish
(55,745 posts)2. Phil Gramm is Vice Chair of UBS working with Bill Clinton and George W Bush.
After leaving government service, they've specialized in all kinds of Wealth Management:
http://financialservicesinc.ubs.com/revitalizingamerica/SenatorPhilGramm.html